Canadian cannabis business operator and investment firm CannaRoyalty Corp. has acquired California’s River Distribution and its affiliates which hold both medical and recreational distribution licenses in the state. The stock deal is worth 5 million CannaRoyalty common shares, another 1,650,000 shares subject to operation milestones, and 2 million shares subject to other financial milestones.
In fiscal year 2017, River Distribution generated $25.4 million. Last year, CannaRoyalty acquired California distributor Alta Supply which generated about $6.5 million in the last fiscal year.
Marc Lustig, CannaRoyalty CEO, said adding River to its holdings positions the company “as a leader in the world’s largest regulated distribution system.”
“Our extensive distribution network in California makes us an ideal partner for brands that are looking to grow in California at scale. And a carefully selected portfolio of manufacturing partners also make us a superior partner for dispensaries seeking one-stop access to a full spectrum of top products and brands, in an efficient and cost-effective manner. Today’s news is a major milestone on CannaRoyalty’s journey to building a global cannabis consumer product platform through consolidation of its existing holdings with some of California’s leading operators.” – Lustig in a press release
Last year CannaRoyalty also took over California’s Kaya Management Inc., the exclusive manufacturer and license holder of rights for Bhang brand vaporizer products.
The River Distribution deal is expected to close by the end of Q2.